DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-6(4), MUMBAI V. RANA KAPOOR, MUMBAI

ITA 4458/MUM/2017

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 3474 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2022
• Appeal Filed By: Department
• Order Result: PartlyAllowed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 15-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA RAJAGOPAL (JUDICIAL MEMBER) ITA No. 4458/MUM/2017 Assessment Year: 2012-13 DCIT, Cent. Cir-6(4), R. No. 1925, 19 th floor, Air India Building, Nariman Point, Mumbai-400021. Vs. Shri Rana Kapoor, F-1/12, HauzKhas Enclave, New Delhi. PAN No. AHIPK 0411 A Appellant Respondent Revenue by : Mr. Ajay Kumar, CIT-DR Assessee by : Dr. K. Shivaram, Sr. Adv. & Mr. Rahul Hakani, AR Date of Hearing : 10/03/2022 Date of pronouncement : 28/04/2022 ORDER PER OM PRAKASH KANT, AM This appeal by the Revenue is directed against order dated 30/03/2014 passed by the Ld. Commissioner of Income-tax (Appeals)-21, New Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2012-13, raising following grounds: (i) “On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of ₹46,45,35,000/- on account of remuneration received from RABO Bank for Shri Rana Kapoor ITA No. 4458/M/2017 2 Shri Rana Kapoor ITA No. 4458/M/2017 3 Shri Rana Kapoor ITA No. 4458/M/2017 4 Shri Rana Kapoor ITA No. 4458/M/2017 5 Shri Rana Kapoor ITA No. 4458/M/2017 6 Shri Rana Kapoor ITA No. 4458/M/2017 7 Shri Rana Kapoor ITA No. 4458/M/2017 8 Shri Rana Kapoor ITA No. 4458/M/2017 9 Shri Rana Kapoor ITA No. 4458/M/2017 10 Shri Rana Kapoor ITA No. 4458/M/2017 11 Shri Rana Kapoor ITA No. 4458/M/2017 12 Shri Rana Kapoor ITA No. 4458/M/2017 13 Shri Rana Kapoor ITA No. 4458/M/2017 14 Shri Rana Kapoor ITA No. 4458/M/2017 15 Shri Rana Kapoor ITA No. 4458/M/2017 16 Shri Rana Kapoor ITA No. 4458/M/2017 17 Shri Rana Kapoor ITA No. 4458/M/2017 18 Shri Rana Kapoor ITA No. 4458/M/2017 19 on record. If the compensation is for giving no objection or consent by the Indian partner of the joint-venture (i.e. the Yes Bank Ltd) then the assessee is required to disclose entire holding of the Yesbank Ltd for ascertaining as to whether any other Indian joint-venture partner has also received any such compensation or it is received only by the assessee. No such information is available on record nor any such information has been asked by the Ld. CIT(A). The Hon’ble Delhi High Court in the case of M/s Jansampark Advertising and Marketing (P.) Ltd. in ITA No. 525/2014 in order dated 03.11.2015 has held that it is true that it is the obligation of the AO to conduct proper inquiry of the material, given the fact that two appellate authorities above are also forum for fact-finding and in the event of AO failing to discharge his functions properly, the obligation to conduct proper inquiry on facts would naturally shifts to the door of the said appellate authority. In the present case, sufficient details were not filed before the AO, but the Ld. CIT(A) could have called for the complete details. 19.5 The Ld. counsel has before us submitted that exiting, the joint-venture by the Rabobank would have adversely affected the share value of the YBL and consequent adverse impact on the shareholding value held by other Indian joint-venture partner. He has further submitted that the Rabobank retained shareholding in Yes Bank Ltd below 5%, though it was agreed for entire exit. Shri Rana Kapoor ITA No. 4458/M/2017 20 Shri Rana Kapoor ITA No. 4458/M/2017 21 Shri Rana Kapoor ITA No. 4458/M/2017 22 Limited as well, for which you have been granted a specific authority supported by a Board Resolution. Your acceptance of the payment of the partnership settlement together with the remission of the aforementioned loan shall be deemed to constitute your waiver of any and all claims so entitlements (it any) towards Rabo Bank (including any and all of Rabo Bank's group companies and affiliates) of whatever kind and on any ground whatsoever. In order to process this payment, you are requested to countersign this letter confirming your agreement to receiving this payment on this basis, and to confirm to us that this agreement meets the requirements of the Reserve Bank of India and that no further governmental or other approvals or corporate esolutions (from Morgan Credit Private Limited or otherwise) are required You will also be solely responsible for fulfilling the tax obligations relating to this transaction, Please also let us know where the net payment is to be forwarded. With vest regards Sd/- Sipko Schat Member executive Board Rabo Bank Netherland” There are no details available on record with reference “one-time partnership settlement”. It is not clear to which partnership the Rabobank is referring, whether it is partnership of the assessee as “employee” of Rabobank Finance or reference is toward the Rabobank as shareholder of Yes Bank Ltd. 19.6 In the light of the above, we are of the opinion that no sufficient evidences are available on record to decide the nature and character of payment of ₹46.45 crores received by the assessee from the Rabobank and further to hold as how Shri Rana Kapoor ITA No. 4458/M/2017 23 Shri Rana Kapoor ITA No. 4458/M/2017 24 of the revenue is accordingly allowed. As the issue in dispute involved in ground No. 1 to 3 have already been restored back to the file of the Assessing Officer, the ground No. 1 to 3 also stands allowed for statistical purposes. 20. In the result, the appeal of the Revenue is allowed for statistical purposes. Order pronounced in the open Court on 28/04/2022. Sd/- Sd/- (KAVITHA RAJAGOPAL) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 28/04/2022 Dragon Legal/Rahul Sharma, Sr. P.S. Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, //True Copy// (Sr. Private Secretary) ITAT, Mumbai